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Wednesday, May 18, 2016

Is Grit Overrated ?

Bully the Bear has a great article on finding meaning in suffering. I'd thought I would build on this idea by critically examining its ancestral concept of Grit because grit has become the buzzword of the day.

Grit is the ability to take punishment and roll with the punches. People with grit find ways to persist through hardship and self-help literature claimed that gritty people become more successful in life. Because of very persuasive speakers like Angela Duckworth, grit is slowly creeping into the public narrative and it is certainly expected that the best bloggers do talk about grit or its derivative concepts every now and then.

I want to propose that instead of looking at Grit as one true trait of worldly success and financial well-being, it may be more instructive to view grit as a framework of similar ideas in the past on the qualities which leads to success.

Before World War II, the desirable trait to have was high IQ. People with high IQ are faster at grasping new concepts and IQ tests were developed by the US Army to assess the cognitive strengths of new recruits. Singapore took this one step further by creating the gifted program in the 80s as attempts to find better ways to harness our human capital. Unfortunately, with criticisms of elitism, IQ has fallen out of favor in Singapore. While I'm not really a gifted person, I find it ludicrous that intelligent people are made to constantly apologize to the masses for not being able to fit in. I think they can do better by hanging out with normal guys like me who appreciate their quick mental reflexes.

Which lead us to the popular trait of emotional intelligence or EQ which was bandied about in the 90s after becoming viral all thanks to a speech by Goh Chok Tong on a book by Daniel Goleman. Since that event, I bet no GEP student ever gone through their lives without an idiot yelling "You high IQ, but low EQ." at them without realizing that demonizing scholars is itself an act which hints at the lack of empathy.

And now we have Grit. A single measure of persistence which the magic pill to all our personal inadequacies. If a person has grit, he will overcome all personal obstacles in life. If he fails, well, he's just not gritty enough.

I want to caution against the tunnel vision of viewing one single trait for success.

[ This is the same reason I don't think you can become a billionaire by simply spouting the pithy wisdom of Jack Ma. Jack Ma is a unique human being. I'm sure he did not build Alibaba because he spent his younger days spouting the wisdom of some older billionaire to other people. ]

The problem with IQ is simply that not all high-IQ people do well in life. Some whose IQ exceed 200 spent their entire lives being misunderstood and being unable to monetise the millions of ideas floating around in their heads. In the book Peak by Anders Ericsson, a study on Go masters in Korea, Japan and China discovered that their mean IQ was actually only 97.

The problem with EQ is even worse. People who are full of empathy and who develop very powerful control over their emotional awareness are found to be more gullible and tend to fall for scams.

There is currently very little literature on the downside of grit. But I can imagine that a very persistent person may pursue an idea so aggressively that he would either go bankrupt over it or spend a large part of his limited lifespan pursuing a dead end business. As there may be a correlation between grit and conscientiousness, I am guessing that people who are too gritty may even have OCD.

My final argument that we should not be overly obsessed with one trait is based on a study on London cab drivers. Scientists find that those who get a license to drive a London Cab has had significant changes to a certain part of their brains such that they can excel at mental tasks which are similar to that of navigating their cabs. However, some tests done for other mental tasks actually showed that the driver performed worse than average person.

When you try to develop a strength at something, are you doing it at the expense of something else ?

Coming back to the essay Bully the Bear, I agree that framing your suffering as a meaningful task will allow you to overcome more obstacles and lead a more fulfilling life.

But life sometimes throws all sort of problems at you. You might work with complete assholes. Your pay grade may not justify the volume of work that you are given.

Your first question should be : Is this suffering necessary for me to commit so much willpower on this issue?

We're back to facing an investment problem again.

Instead of determining your allocation of financial assets, you should be thinking about allocating your attention and willpower to the problem.

3 comments:

I think it's analogous to MMORPG games like WOW or Diablo 2/3 (in fact I think a lot of things are! Hence RPGs could very well train yang chewren how to "hustle" in life and perhaps offer some sort of simulation in dealing with difficult situations...) where attaining wealth and skill [through legitimate means, and not "cheating" by spending real money) isn't just simply farming the same spot over and over again - it's usually (i) those few purchases (investments) that pay off over time, (ii) studying/theory-crafting different permutations of hero abilities, items and strategies, (iii) as well as lots of practice (dueling, ganking, battles...) that enables a gamer to elevate or even leapfrog, from being a novice to an expert.

TLDR - getting to success seems to be quite a winding path, and not quite attributable to a singular (or a set of) X factor(s).

I think this "framework" you've mentioned, could be better described as personal values - like honesty, straightforwardness etc etc... and that these values determines the kind of winding path one would take, rather than how one would traverse a given path.

My speculation -- With a given (i) value set and (ii) one's cumulative experiences: (ii) reinforces (i), and both will need to be used sparingly. E.g.: not to go overpower on Grit, and pursue a continuous failing/hopeless venture - but to have a "counterbalance" of values/experience, against Grit, so one doesn't tests one's conviction till destruction.

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Sidetracking...

In the bigger scheme of things (lets say... in the eyes of an all-knowing god), it's plausible that simply lumping a couple of observations of a person, into a single variable as IQ or EQ, may be a naive pursuit -- I guess it's like a bank CEO relying very much on a single VaR number for the bank's entire balance sheet, there's simply fatter tails in finance [in context of a distribution curve] and it's kinda tricky to just whack out a single numerical metric to indicate central tendency of a population...

Surely one with a IQ quotient would generally be better at solving problems, grasping ideas or finding flaws in an argument - but, using the analogy of central tendency of a distribution, it doesn't quite account for outliers (tails) and really, anything that's not even on the distribution (a kid/adult, can change after all). Perhaps someone with significantly higher EQ or IQ could better serve society in very specialised areas: science, medicine, math... I would like to think it might be good chance that 1 of these folks, could be the next Elon Musk or Larry Page. (hence, I might argue: back to my speculation, of a set of values + experiences)

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I suppose... For the "normal" people who recognises the need to be financially free and actually wants to move towards it, I suppose one must know oneself (one's value set) and work out what's a comfortable balance he/she wants - this should enable one to find out what investment strategies are befitting for him/herself. (and of course, the grunt work of reading/research/studying etc)

I feel sorry for people believing things like "5 things you should..." or trying to live up to Warren Buffet's "rules"... like culture and blood type, it doesn't quite apply to everyone.

I think the thing about grit is that not everyone has it awakened in them. Not everyone will make it through a crises without giving up. There is survival bias involved because only people who have come through the immensely high obstacle will be able to say that they have the grit in them. Those who failed will only give you excuses, and not blame that they have insufficient grit.

And the thing about grit is that the harder it was for you to attain it, the greater the overcomer you will be in life in future. Because it has already set a benchmark or threshold for you. Having grit doesn't necessarily mean success or failure, but rather, I feel that it's attaining the mindset that "I can do more", "I can go further", which are values that are appreciated.

I don't think you should use grit for investing though. If it's a mistake in the investment, it's a mistake. There's a difference between grit and stubborn-ness haha!

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About Me

I have recently completed my Juris Doctor and I am now a candidate for the Part B Singapore Bar Exams. For the past 15 years I was an IT manager and I have worked in multinationals, financial exchanges, trade unions and even a government agency. I started my career as an AS/400 administrator and moved on to manage IT projects and operations.

Through my personal savings and investments, I earned my financial independence at age 39 after my investment income started to exceed my monthly take home pay. One of my first acts upon retirement is to go back to Law School to reinvent myself as a legal professional. I am likely to be in the practice of corporate litigation.

My three books on Personal Finance explain the processes by which I attained my financial independence.Growing your Tree of Prosperity was a local Straits Times bestseller in 2005. I was featured in Me and My Money sections in the Sunday Times twice.

Qualifications include a Juris Doctor(Cum Laude), Bachelor in Engineering from NUS (1st Class Honours) and a Masters in Applied Finance also from NUS. I have the CAIA, FRM qualifications and passed all three CFA examinations.